eBook Measures of liquidity, Solvency, and Profitability The comparative financial statements of Marshall Inc. are as follows. The market price of Marshall common stock was $ 63 on December 31, 2012. Marshall Inc. Comparative Retained Earnings Statement For the Years Ended December 31, 2012 and 20Y1 20Y2 20Y1 Retained earnings, January 1 $1,668,575 $1,419,025 Net income 364,000 290,700 Dividends: On preferred stock On common stock (6,300) (6,300) (34,850) (34,850) $1,668,575 Retained earnings, December 31 $1,991,425 Marshall Inc. Comparative Income Statement For the Years Ended December 31, 2012 and 20Y1 20Y2 20Y1 Sales $2,309,355 $2,127,690 Cost of merchandise sold 854,100 Gross profit $1,455,255 785,770 $1,341,920 Selling expenses $495,680 $600,240 Administrative expenses 422,255 352,520 Total operating expenses $917,935 $952,760 Income from operations $537,320 $389,160 Other revenue and expense: Other revenue 28,280 Other expense (interest) (152,000) 24,840 (84,000) Income before income tax expense $413,600 $330,000 Income tax expense 49,600 Net income $364,000 39,300 $290,700